Checks written by a company, but not yet paid by the bank, appear on the bank reconciliation as __________ and are called __________.
A)deductions from the bank balance; checks in transit
B)deductions from the bank balance; outstanding checks
C)additions to the bank balance; checks in transit
D)additions to the bank balance; check items

Question

Quizplus · Accepted Answer

Checks that have been written by the company but have not yet cleared the bank are deducted from the bank balance and are referred to as outstanding checks, not checks in transit. Checks in transit refer to checks that have been received by the bank but have not yet been credited to the company's account. Addition to the bank balance and check items are not the correct terms for describing these checks.

Checks Written by a Company, but Not Yet Paid by the Bank